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Sen. elect White to promote rules for oil shale development

Commercial oil shale production might be years away, but Republican state lawmakers plan to craft some general policies this year that could set the stage for developing the abundant fossil fuel.

Sen.-elect Al White, R-Hayden, said he plans to carry legislation to start a rule-making process governing how and where oil shale can be developed in Colorado.

“The bill will establish a task force whose job it is to do a rule making for oil shale extraction and what parameters need to surround oil shale when it becomes commercially viable,” he said
Colorado, Utah and Wyoming have an estimated trillion barrels of crude oil locked in their shale formations.

Rep.-elect Laura Bradford, R-Collbran, said she hopes the task force, with members appointed by the Legislature, will “depoliticize” the debate over oil shale.

Though no company has announced imminent commercial development, a number of firms, including Shell, have research and development projects under way in the region.

Rep. Kevin Lundberg, R-Berthoud, has announced he will run a bill to “incentivize” commercial oil shale production by cutting the state’s severance tax on the fuel.

“(It’s) an incentive by discounting the oil shale severance taxes through the year 2020 if any company will start to develop a commercial program by 2012,” Lundberg said.

Glenn Vawter, executive director of the National Oil Shale Association, said it is good to see lawmakers gearing up for that future.

“I think any encouragement at the state is helpful,” Vawter said. “I think right now with oil prices the way they are … there’s a lot of people thinking, Utah is a better place to do business, shall we say.”

Even if the governor signs the bills into law, commercial oil shale could face steep opposition at the federal level thanks to President-elect Barack Obama’s appointment of Sen. Ken Salazar, D-Colo., as the head of the Interior Department.

Salazar, whose agency will oversee and issue permits for energy development on federal lands, has announced his opposition to a series of proposed federal rules governing oil shale extraction.

“If we are to succeed in developing oil shale responsibly, which I support, we need to establish an orderly process for development that protects Colorado’s communities, protects our water and helps us avoid the busts that have, in the past, set us back,” Salazar said in a November statement.

White acknowledged some might see his and others’ efforts as premature, but it is better to be proactive rather than reactive after a boom.

“Why wait until the problems arise?” White said. “Let’s see if we can anticipate them.”